Can You Believe it can be as Easy to Earn $1.45 or $400+?
This month, I had an experience that triggered an "aha" moment for me. It was something I knew, but something I obviously needed to be refreshed about.
I had 6 sales from one affiliate program that amounted to $8.74--that means I earned approximately $1.45 per sale. While many people here would say I should celebrate about that, I felt I could do much more.
I know how much time and effort I'd invested in those articles to earn the $8.74 and I know by way of my choices, I paid myself less than minimum wage. I learned from it though and I want to share my learning lesson with you. Hopefully, my learning lesson can expedite your growth and earn you some good money!
The Requirements and Costs of Using SEO
Using SEO, it takes 1500-2000 words of content to rank for many keywords nowadays, then, it takes 6 months on average for the article to rank. Now, my articles I wrote 6 months or more ago are ranking, and I'm getting the chance to learn from the results I'm reaping.
I wish I had done the math on how much expected revenue would come out of each article 6 months down the line (if it were to rank) based on the affiliate promotions I'd included. If I had done the math, I'd know that each transaction could average $1.74 to $4. It's funny, I always tell my referrals (or others who are new) to find a good niche with good products to promote and give them clear guidelines to follow, but I didn't think it all out for myself.
Our Responsibility in Business
In affiliate marketing and sales, we have the option to choose what products and services we promote. We choose what commissions we get.
Our time is valuable. We don't know how many more posts we'll be able to hash out or how many campaigns we'll be able to do, and regardless of our physical, mental, or emotional capabilities, it's each and every choice that determines how much of our potential we truly harness.
I chose to be in an affiliate program that paid me 40% yet the commission changed, and is now 12%. Even with the 40% commission, the average sale from my site is too low to achieve my financial goals without alot of traffic and sales volume. However, since I didn't really think it out, I took my time to create articles around something that wasn't really a good opportunity to make good money.
Learning lesson #1: Choose affiliate programs that are stable and have a track record of taking care of their affiliates.You don't want to bother with companies that will pay you 40%, then within 16 months (my affiliate journey so far), they will drop the commission more than half. It can really mess up your income projections.
My "Aha" Moment
Alternatively, I took less time to write an article and promote a product that sold from my website for $997. That product earned me a commission of $398.98.
The contrast of the two experiences: one higher price and lower sales volume, and the other lower price and higher sales volume triggered the "aha" moment. I need to be much more careful with each post and each promotion to be strategic.
Business is about helping people and to stay in business, you have to make a profit. I can put myself out of business by making decisions like spending too much time on campaigns that pay pennies.
You can too.
The Business Tragedy
I've heard of alot of people who get into business and go back to jobs because of simple mistakes like this one, so let this post serve as your warning. They may do this several times without noticing they need to pivot and choose a niche or affiliate programs that pay them better.
The Optimal Situation
I don't want that to be you. I want you to make this business work. Let's win together.
Choose good affiliate programs and products to promote based on:
- The stability and reputation of the company
- The relevance to your target audience
- The quality
- And, the math and how it plays into your overall business plan
Even worse, the higher ticket product was easier to sell, and I think the buyer might even be happier with the outcome. There are good opportunities out there to earn from high ticket affiliate programs without sacrificing quality. You and I have to take out time and spot out good opportunities for us.
What the Success Stories Seem to Have in Common
Watch most of the great success stories. Many of the success stories of people who are earning tens of thousand of dollars selling products or services aren't because they're promoting products and services that are $50 or less and selling in high volume to new customers.
Even with companies like McDonald's, their success isn't based on high volumes of new customer acquisition. They're not making their money off of one burger on the dollar menu! In essence, they earn "high ticket commissions" from each customer because their retention and lifetime customer value is so high. Starbucks is the same way!
Lifetime Customer Value Craziness
According to Business Insider, Starbucks has a lifetime customer value of $14,099! That means when they get a customer for the first time, they're not looking at that customer as a $4 drink purchase, they're looking at the customer as $14,099 over the life of the customer relationship. We need to think this way as well.
How can we get repeat business? How can we get the same customers to stay with us for the long haul?
We can go on spinning our wheels over and over, if we're not thinking about how to keep customers when they come to us. I would hope my $1.74 customer will come back and purchase based on my recommendations again, and doesn't leave me feeling like, "why did I spend all that time on an article with low pay potential?". Regardless, in the future, I'd prefer to be on the safer side and choose my promotions a little smarter upfront. I'd recommend, we find either:
- Recurring affiliate programs with high lifetime customer value (like WA)
- Or, one-time sales with high commissions
It's Okay to Avoid Worrying about CashFlow Sometimes, But...
It's okay to sprinkle brand awareness and low ticket offers here and there. I'm not suggesting at all to skimp on quality or customer satisfaction--that should be a given.
However, if we want to build a full-time income, we need to be careful to do the math, be realistic, and choose products and services to promote (even if they're our own) that will help us reach our goals.
I just wanted to leave this food for thought.
If you haven't already, check out my case studies and trainings. I create each training module to encourage you to grow your business and motivate you with my wins and mistakes, so you can benefit.
Here is my 15 month case study: https://www.businessinsider.com/lifetime-value-of-a-starbucks-customer-2016-1
16 Month case study: https://my.wealthyaffiliate.com/training/my-16th-month-case-...
The Beginning of my 6-part Business Planning Series: https://my.wealthyaffiliate.com/training/intro-to-the-minimu...
My Questions for You
That's all I have for this post, but I'd love to hear...
- Are you selling low ticket products?
- What's your strategy for achieving your financial goals?
- Have you considered finding higher ticket products to promote (whether making your own or working with an affiliate partner)?
- What's your reservations about promoting higher ticket products with good commission terms?
Leave your comments, questions, and concerns below.